Finance: Unit economics
Showing 47 articles for Finance: Unit economics.
AutoZone: How Exemplary Capital Allocation Compounds Returns
Business Breakdowns
November 24, 2021
Unit economics
9
Business models
8
Cash flow management
7
- Reduced share count by 86% while growing net income 10x, compounding EPS roughly 100 times through disciplined buybacks.
- Operates a 40% ROIC specialty retail business with 55% gross margins by selling service and availability, not just parts.
- Serves an expanding, predictable market of aging cars requiring maintenance; consolidation and commercial growth offer runway for the next decade.
Eight passive income streams that generate $40k per week
Noah Kagan
May 21, 2021
Unit economics
8
Bootstrapping
6
- Passive income never replaces active work — it scales wealth you already built.
- Return on time beats ROI: one-time effort compounding forever is the real goal.
- Software and index funds outperform Airbnb and affiliate blogs for consistent yield.
How to consistently increase gross margins in your business
Cameron Herold
February 7, 2021
Pricing strategy
9
Unit economics
7
Processes & SOPs
5
- Raise prices at least 2–3% every year, minimum.
- Renegotiate supplier costs every six to twelve months — just ask.
- Inventory businesses need gross margin × turns to hit 240 or above.
YouTube ad revenue across three channels and 4M subscribers in 2020
Silicon Valley Girl
February 7, 2021
Unit economics
9
Business models
6
- Business content CPMs run 3x higher than language-learning channels
- Evergreen videos from prior years compound into significant ongoing income
- Subscribers don't pay — viewer geography and topic determine your earnings
How Dude Perfect earns $22 million a year from seven income streams
Noah Kagan
February 6, 2021
Unit economics
9
Branding
8
Business models
7
- Live events — not YouTube ads — are their single biggest earner at $7.5M
- Every product stream follows one model: they market, partners handle operations
- 54M subscribers turns even a 1-in-1,000 conversion rate into millions
How to calculate burn rate, runway, and growth rate
Y Combinator
January 25, 2021
- Burn rate tracks cash flow, not profit — signed contracts don't count.
- Growth rate must be compounded; a 6x gain over 6 months is ~35% CMGR, not 100%.
- Misusing MRR or non-compounded growth signals incompetence to investors.
How MKBHD earns $6.4 million a year from six income streams
Noah Kagan
January 18, 2021
Unit economics
9
Business models
8
Content marketing
6
- Merchandise outsells AdSense — $2M vs $1.57M annually
- Owning product collabs beats sponsorships for long-term upside
- 12 years of weekly uploads is the real competitive moat
Cash flow management
YouTube
Managing startup finances: avoid the cash traps that kill companies
Y Combinator
August 22, 2019
Cash flow management
10
Unit economics
7
Processes & SOPs
5
- Three numbers — burn, runway, growth rate — tell you everything about company health
- Hiring before product-market fit won't get you there faster; it just burns cash
- Start fundraising at 12 months runway, not 6 — leverage disappears as cash falls
How to calculate and increase your value as an employee
StoryBrand With Donald Miller
August 5, 2019
Unit economics
8
Prospecting & outreach
5
- Your worth is your open-market replacement cost — not your tenure
- One employee's VIP idea generated $48k extra in a month
- Visible, measurable contributions are the only path to raises
Opportunity cost: why chasing good revenue kills great revenue
StoryBrand With Donald Miller
July 2, 2019
Unit economics
9
Long-term planning
7
Pricing psychology
5
- Accepting $5,000 gigs blocked $500,000 in book revenue
- Good opportunities are often the enemy of great ones
- Always calculate the revenue and overhead cost of every decision
How to increase profit margins by doing less for more
StoryBrand With Donald Miller
June 10, 2019
Unit economics
9
Business models
6
- High revenue can hide terrible margins once operational costs are counted
- Opportunity cost: complex programs drain bandwidth from more profitable work
- Ask if every revenue stream can be done with less effort for more money
Buying vs. renting: a real numbers breakdown
Noah Kagan
March 15, 2019
- A $67k apparent profit shrank to a $4,800 advantage over renting
- Your down payment tied up in property has a real opportunity cost
- High mortgage overhead kills financial flexibility when income drops
Real estate investing vs short-term rentals: a practical framework
Noah Kagan
March 1, 2019
Unit economics
9
Business models
6
Cash flow management
5
- Cap rate beats cash flow — buy on income stream, not appreciation bets
- Airbnb is running a hotel, not being a real estate investor
- Wealth doesn't kill financial anxiety; only emotional work does
Real Airbnb Economics: 10% Returns, Rising Risk, Declining Revenue
Noah Kagan
September 29, 2017
Unit economics
8
Business models
6
- $80k deposit, 10% cash-on-cash return on paper.
- Revenue fell 60% in two years as supply surged.
- Opportunity cost kills it — better uses exist for time.
The real economics of writing and publishing a book
Noah Kagan
May 9, 2017
Unit economics
9
Business models
7
Content marketing
5
- Most authors never earn beyond their advance — and that's fine.
- The real money comes from what the book enables, not sells.
- Sustained weekly sales over years beat any launch spike.